HQ 225246: Protest 1704-93-100223; 19 U.S.C. 1504; 19 CFR 159.12; HQ225162; HQ 224294; St. Paul Fire & Marine Insurance Co. v. U.S.

Native CBP ruling rendition. Applicability is fact-specific; modification/revocation relationships and original publisher date are retained. Publisher sentinel year0001 means unknown date, not a historical legal adoption.

                            HQ 225246

                         August 11, 1994

LIQ-11-CO:R:C:E 225246 AJS

CATEGORY: Liquidation

District Director of Customs
U.S. Customs Service
1 East Bay Street
Savannah GA 31401

RE: Protest 1704-93-100223; 19 U.S.C. 1504; 19 CFR 159.12; HQ
225162; HQ 224294; St. Paul Fire & Marine Insurance Co. v. U.S.

Dear Sir or Madame:

     This is our decision in protest 1704-93-100223, dated May 6,
1993, concerning the liquidation of various entries.

FACTS:

     The subject entries involved sprayer parts.  The merchandise
was entered under subheading 9817.00.50, Harmonized Tariff Schedule
of the United States (HTSUS), which provides for machinery,
equipment and implements to be used for agricultural or
horticultural purposes.  The merchandise was liquidated under
subheading 8424.90.90, HTSUS, as sprayers parts. 

     Entry number one was entered on March 22, 1989, and liquidated
on February 5, 1993.  A search of Customs computer records
indicates that liquidation of this entry was extended three times
with the last extension made on December 10, 1991.  Notice of this
extension was mailed on December 12, 1991.  On January 21, 1993, a
Customs Form (CF) 29, Notice of Action, was issued to the
protestant stating that the merchandise had been misclassified and
undervalued.

     Entry number two was entered on April 7, 1989, and liquidated
on February 5, 1993.  A search of Customs computer records
indicates that liquidation of this entry was extended three times
with the last extension made on January 15, 1992.  Notice of this
extension was mailed on January 18, 1992.  The same type of CF 29
as that issued in entry one was also issued.

                               -2-

     Entry number three was entered on April 26, 1989, and
liquidated on February 5, 1993.  A search of Customs computer
records indicates that liquidation of this entry was extended three
times with the last extension made January 15, 1992.  Notice of
this extension was mailed on January 18, 1992.  The same type of CF
29 as that issued in entry one was also issued.

     Entry number four was entered on June 20, 1989, and liquidated
on March 5, 1993.  A search of Customs computer records indicates
that liquidation of this entry was extended three times with the
last extension made on March 4, 1992. Notice of this extension was
mailed on March 7, 1992.  On February 2, 1993, a similar CF 29 as
that issued in entry one was also issued.

     All four entries were extended because additional information
was needed for the proper appraisement and classification of the
merchandise.

ISSUE:

     Whether liquidation of the subject entries was properly
extended pursuant to 19 U.S.C. 1504(b), or were they deemed
liquidated by operation of law.

LAW AND ANALYSIS:

     Initially, we note that this protest was timely filed pursuant
to 19 U.S.C. 1514(c)(3)(A).  The subject entries were liquidated on
either February 5 or March 5, 1993, and the protest was filed on
May 6, 1993.  We also note that the liquidation of an entry is a
protestable matter pursuant to 19 U.S.C. 1514(a)(5).

     19 U.S.C. 1504(a)(1) provides that except as provided in
subsection (b) of this section, an entry of merchandise not
liquidated within one year from the date of entry of such
merchandise shall be deemed liquidated at the rate of duty, value,
quantity, and amount of duties asserted at the time of entry by the
importer of record.  The subject entries were liquidated more than
one year after the date of entry.  

     19 U.S.C. 1504(b), however, provides that the Secretary of the
Treasury may extend the period in which to liquidate an entry by
giving notice of such extension to the importer of record in such
form and manner as the Secretary shall prescribe in regulations, if
(1) information needed for the proper appraisement or
classification of the merchandise is 



                               -3-

not available to the appropriate customs officer.  19 CFR
159.12(a)(1) provides that the district director may extend the 1-
year statutory period for liquidation for an additional period not
to exceed 1 year if information needed by Customs for the proper
appraisement or classification of the merchandise is not available. 
Customs previously stated that this additional 1-year period
expires 1 year from the expiration of the 1-year statutory period
for liquidation, which in this instance expires 1 year from the
date of entry.  HQ 224294 (January 10, 1994), and HQ 225162 (May
20, 1994).   
     A search of Customs computer records indicates that
liquidation of the subject entries was timely extended three times
and that notice of these extensions were also issued. Liquidation
of the subject entries was extended because information was
required for the proper classification and appraisement of the
merchandise.  The protestant does not dispute that these extensions
were received nor that they were proper.  

     19 CFR 159.12(d) provides that if an extension has been
granted because Customs needs more information and the district
director thereafter determines that more time is needed, he may
extend the time for liquidation for an additional period not to
exceed 1 year provided he issues the notice required by paragraph
(b) of this section before termination of the prior extension
period.  Customs previously stated that this additional period will
expire 1 year from the expiration of the initial extension, or in
other words it will expire on the third year anniversary of the
entry date.  See supra HQ 224294 & HQ 225162.  Section 159.12(e)
provides that total time for which extensions may be granted may
not exceed 3 years (i.e., up to four years from the date of entry). 
Therefore, if a third extension is issued it will expire on the
fourth year anniversary of the date of entry.  In this instance,
Customs extended liquidation of the subject entries for two
additional periods not exceeding one year because more information
was needed.  The total time for which extensions were granted did
not exceed three years.  Therefore, Customs satisfied the
regulatory requirements of section 159.12.  

     19 U.S.C. 1504(d) formerly provided, in part, that any entry
of merchandise not liquidated at the expiration of four years from
the applicable date specified in subsection (a) of this section,
shall be deemed liquidated at the rate of duty, value, quantity,
and amount of duty asserted at the time of entry by the importer of
record.  The applicable dates specified in subsection (a) in this
case are the dates of 



                               -4-

entry (i.e., March 22, April 7, April 26 and June 20 of 1989). 
Customs liquidated the subject entries on either February 5 or
March 5 of 1993, which precedes the expiration of four years from
the applicable date of entry.  As stated previously, a proper basis
also existed for extension of liquidation.  Therefore, Customs
satisfied the four year liquidation requirement of section 1504(d). 
Consequently, the subject entries were not deemed liquidated by
operation of law, but by the actions of Customs on the relevant
liquidation dates.

     The protestant claims that it did not receive notice of any
subsequent extensions after receipt of its third notice of
extension for each entry, and that Customs also had no basis to
further extend liquidation after these last extensions.  Customs
was not required nor even permitted to issue any additional notices
after the third notice.  As discussed previously, the three
extensions issued allowed Customs up to four years from the date of
entry to liquidate the subject entries.  Therefore, the
protestant's claim regarding subsequent extensions is without
merit.  Inasmuch as Customs did not issue any of the claimed
subsequent extensions, the issue of the basis for these extensions
is moot.  

     The protestant cited to the recent decision of the Court of
Appeals for the Federal Circuit (CAFC) in St. Paul Fire & Marine
Insurance Co. v. United States, 799 F. Supp. 120 (Ct. Int'l Trade
1992), rev'd, Slip-Op 93-1029 (October 1, 1993).  The issue in St.
Paul was whether the Court of International Trade (CIT) erred in
determining that the second and third extensions of liquidation
granted by Customs were unlawful.  Customs had extended liquidation
while awaiting information needed for the proper appraisement and
classification of the merchandise.  The CAFC concluded that:

          Congress has given Customs authority to employ up      to
four years to liquidate entries when properly noticed  extensions
are granted for statutory reasons.  When 
     seeking information needed for the proper appraisement      or
classification of the merchandise, Customs has no           duty to
inquire whether the required information will be  forthcoming, and
Customs may employ the full four-year   period unless it has actual
knowledge that the required   information will not be submitted. 
Only if Customs has      such knowledge . . . can it abuse its
discretion by  granting further extensions.    

In this case, Customs employed less than four years to liquidate
the subject entries.  In addition, notices of extension were issued
and they were issued for proper 

                               -5-

reasons.  Customs also possessed no knowledge to indicate that the
required information would not be forthcoming.  Therefore, we find
the cited language from St. Paul supportive for the conclusion that
liquidation of the subject entries was properly extended. 

HOLDING:

     The protest is denied.  Liquidation of the subject entries was
properly extended and completed by the actions of Customs on either
February 5 or March 5, 1993.

     In accordance with Section 3A(11)(b) of Customs Directive 099
3550-065, dated August 4, 1993, Subject: Revised Protest Directive,
this decision should be mailed, with the Customs Form 19, by your
office to the protestant no later than 60 days from the date of
this letter.  Any reliquidation of the entry in accordance with the
decision must be accomplished prior to mailing of the decision. 
Sixty days from the date of decision the Office of Regulations and
Rulings will take steps to make the decision available to customs
personnel via the Customs Rulings Module in ACS and the public via
the Diskette Subscription Service, Freedom of Information Act and
other public access channels.


                                 Sincerely,


                                 John Durant, Director
                                 Commercial Rulings Division